Walmart Fails As Wehrmacht

by David Macaray / August 26th, 2011

Walmart can boast that it has more than 8,500 stores in 15 countries, under 55 different names, that it is the largest employer in the United States, the largest employer in Canada, and the largest employer in Mexico (as Walmex). It has 108 stores in China alone, and operates another 100 Chinese outlets under the name of Trust-Mart.

Still, for all of Walmart’s conspicuous success (which some might call wretched excess), the world’s mega-retailing giant, after having set up shop in Germany in 1997, was forced to withdraw from the country in 2006, abandoning their lucrative $370 billion retail market. Interestingly, the withdrawal was due largely to cultural differences.

While the German debacle qualifies as old news, it’s worth reviving. At first blush, given the vaguely similar cultural/political antecedents, one might assume that an American business would have a greater chance of succeeding in Europe than in an Asian setting, particularly one that had been isolated from the West. But, as the German experience has shown, that’s not necessarily the case. Indeed, while the nominal Communist regime of China embraced Walmart’s corporate philosophy, the Germans rejected it.

Since Walmart’s abrupt 2006 exit there’s been much discussion as to why the venture failed. One of the explanations (favored by environmentalists) is that Germany was simply too “green” for a slash-and-burn outfit like Walmart, that Germany’s enlightened consumers resented Walmart’s love affair with plastic bags and plastic junk While there may be some truth to the noble “green” theory, three other explanations seem to make more sense.

First was the chanting. Arguably, what initially stuck in the craw of German workers was the mandatory chanting. Walmart employees are required to start their shifts by engaging in group chants and group exercises, a practice intended to build morale and drive home the importance of company loyalty. While performing synchronized calisthenics Walmart employees are required to chant, WALMART! WALMART! WALMART!

Apparently, this kind of happy horseshit didn’t go over well with the Germans. Maybe they found it too embarrassing, maybe they found it too regimented, maybe they found this aggressive, mindless and exuberant group-psychology too painfully reminiscent of certain rallies, like one that occurred in Nuremberg some years ago.

The second problem was the smiling. Walmart requires its checkout people to smile at customers after bagging their purchases. Plastic bags, plastic junk, plastic smiles. Walmart employees who refuse to flash a bright but insincere smile at exiting shoppers can be fired. But alas, in German society, merchants and customers don’t exchange reflexive smiles. In Germany, smiles are genuine; smiles actually mean something. Thus, Walmarters grinning like jackasses at total strangers not only didn’t impress the Germans, it unnerved them.

And third was the ethics problem. Walmart’s corporate policy prohibited sexual intercourse among employees. This applied to all in-store romances: boyfriends and girlfriends, and husbands and wives (even if they met at work and fell in love). Apparently, the Arkansas-based company had no problem with screwing the environment, but objected to employees doing it with each other.

Although a German court struck down this sexual prohibition in 2005, Walmart’s bizarre ethics policy left a bitter residue; and that ethics policy, coupled with the ritual chanting and mandatory smiling, more or less poisoned the whole deal. So Germany is now verboten to Walmart. Presumably, they’ll open stores in Libya to take up the slack.